​Tech Mahindra to acquire Swiss firm SOFGEN Holdings

MUMBAI: Tech Mahindra said on Friday that it acquired Switzerland's SOFGEN Holdings Ltd in its quest to boost its financial services offering and reach its $5-billion topline target by 2015. This is the third deal Tech Mahindra has struck in as many months. In November, the company had announced it was buying Lightbridge Communications for $240 million. Earlier this week, it formed a joint venture with Avion Systems, in which it will hold a minority stake.

Though Tech Mahindra did not disclose the value of the SOFGEN deal, a source with knowledge of the matter, pegged it at around $50 million. “This acquisition gives us an opportunity to enhance our expertise to implement modernized core banking & transformation services capabilities,” CP Gurnani, MD & CEO, Tech Mahindra, said in a statement.

SOFGEN has over 450 employees with 20+ Tier 1 client relationships. It has the second-largest pool of Avaloq consultants in the world and is a large Temenos partner, Tech Mahindra and SOFGEN said in a press release. “In the past decade, SOFGEN has grown to be a leading player in niche market segments such as private, wealth, retail and commercial banking.

Bringing it into the Tech Mahindra fold will give us access to new geographies, and a different magnitude of customer relationship.” said Alexander Dembitz, chairman, SOFGEN. Tech Mahindra had stated that it was looking to boost its financial services business and was said to be in talks with Polaris Financial Technologies for months.

“This deal gives them greater exposure in BFSI, which they were lacking. I think they would be very close to that $5-billion target by the end of 2015,” an analyst with a Mumbai-based brokerage said. He declined to be identified. Tech Mahindra crossed $3 billion in revenue in FY13-14. The SOFGEN transaction is expected to close this year. Avendus Capital was the advisor to the Swiss firm.